In Twist, Sterling May Allow His Wife to Sell the Clippers

Rochelle Sterling co-owns the Clippers with Donald Sterling through a family trust.

Danny Moloshok / Reuters

By SCOTT CACCIOLA

May 23, 2014

The nightmare scenario for the N.B.A. in its efforts to end Donald Sterling’s ownership of the Los Angeles Clippers has been simmering for weeks: a protracted legal battle against a man who is no stranger to the courtroom.

However, Sterling signaled Friday that he could be looking for a way out by trying to empower his wife, Rochelle, to negotiate a sale of the Clippers, according to a person close to the discussions who requested anonymity because he had not been authorized to speak publicly about them.

Any number of issues could derail such a plan, including Rochelle Sterling’s possible desire to retain a minority stake in the Clippers. That could be a sticking point for the league, which has made clear that it wants to eject both Sterlings from the N.B.A.

Still, the notion that Donald Sterling would be willing to part with a team he has owned since 1981 is a surprising turn in a nearly monthlong story that has overshadowed the playoffs and thrown the league’s race relations into sharper focus.

In response to reports about the Sterlings’ proposed arrangement, Mike Bass, an N.B.A. spokesman, issued a statement Friday in which he said the league was continuing its efforts to terminate their ownership of the team. The statement did not address whether the league had been in discussions with them.

“We continue to follow the process set forth in the N.B.A. constitution regarding termination of the current ownership interests in the Los Angeles Clippers,” Bass said, “and are proceeding toward a hearing on this matter on June 3.”

Rochelle Sterling owns the team with her husband through a family trust. It was unclear if the N.B.A. would agree to let her keep an interest in the franchise as part of any sale. A league spokesman declined to comment.

Sterling, 80, was barred from the league for life last month for making racist remarks, and he appeared to be girding himself for a fight as the league sought to terminate his ownership of the Clippers. He declined to pay a $2.5 million fine imposed by Commissioner Adam Silver, and his lawyer sent the league a letter last week threatening legal action.

In a June 3 special hearing with the league’s other owners, Sterling is set to answer to charges that he engaged in conduct that damaged the league and its partners. A vote of three-fourths of the owners is required to force him to sell his franchise, and Silver appears to have broad support for such a measure.

On Tuesday, though, Silver said he was open to the idea of the Sterlings’ selling the team on their own as a way of avoiding a formal termination.

“I’m sure if he wanted to sell the team on some reasonable timetable, I’d prefer he sell it than we go through this process,” Silver said. “I’m open to that.”

In recent days, public outrage continued to mount against Sterling. Last week, CNN aired an hourlong interview with Sterling in which he made several volatile remarks about the former player Magic Johnson. After the interview was broadcast, Silver released a statement in which he apologized to Johnson on behalf of the league.

Rochelle Sterling, who has cast herself as an innocent bystander, said in an interview last week that she would pursue litigation if the league tried to strip her of her share of the team’s ownership. Her lawyer, Pierce O’Donnell, said at the time that he was hoping to find some sort of resolution with the league but that he was prepared “to go to war.”

Another hurdle in the proposed sale agreement between the Sterlings is that Donald Sterling is the Clippers’ controlling owner and the N.B.A. must approve any transfer of power — in this case, from Sterling to his wife, at least temporarily, as she pursued a buyer.

A sale of the team could fetch $1 billion or more, according to analysts, and the potential suitors include entertainment moguls like Oprah Winfrey and David Geffen.

An obstacle may remain, however, if Rochelle Sterling wants to retain a minority share. The N.B.A. has cited its constitution in arguing that if the owners vote to terminate the interest of a controlling owner, the interests of all other partners are terminated as well.

Lawyers and legal experts said the Sterlings would face uphill fights if they were to pursue litigation against the N.B.A., but an injunction could delay a sale of the team. The league probably wants to avoid a drawn-out legal battle for several reasons, including a desire to placate the players, many of whom have called on the league to put new ownership in place as soon as possible.

In addition, the league and its other owners could subject themselves to unwanted public scrutiny if a lawsuit were to go to trial. Almost every professional sports league works hard to keep its affairs private, especially its finances. But a case like this one also involves personal conduct, which makes it unique.

“Sterling’s knowledge of what other owners have done could be relevant and probative on some level,” said Robert Boland, a sports business professor at New York University. “I don’t want to overstate it, but this could be a trip through the dirty laundry of all the owners.”

He added, “I’d like to think there are owners who would like to see this concluded short of the nuclear option that’s been on the table.”

Rochelle Sterling, who said last week that she was estranged from her husband, could also throw a wrench into the proceedings by filing for divorce. Under California’s community property law, a divorce could delay a sale until the couple’s assets were divided.

“One thing I know as a lawyer is that the settlements always come when the jury is being called in to start the case,” Boland said.